A massive selloff in 3M stock following its earning reports set the trading tone on Thursday, and it was bearish. 3M stocks sold off hard all day.
The action in the major stock indices is reminiscence of the previous market tops, 1987, 2000, 2007, just before the start of their bear markets.
Currently the Dow so far has failed to make a higher high above October swing high, setting up a potential lower high. If that is so, and if the stock market starts selling off, it will trap the bulls, setting a stage for a waterfall decline.
For NQ key support price level for Friday is October swing high of 7750. With many trailing stop-loss just below breakout day low of 7740, a clear break below 7740 will start to run-over trailing stop-loss for those who bought the recent breakout. A failed breakout will trigger massive selling that should easily crash through supports.
With stocks futures continuing to sell-off in overnight trading, key support for NQ on Friday will be 7750. Should that break we could see a cascade of selling.
If the market manipulators manage to push the market up by the opening bell, and push NQ up above 7730 now resistance, we could see a typical choppy-sideways Friday price action/pattern.
